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Bachmann: 'Scare tactics' in debt ceiling issue

WASHINGTON (AP) — On the eve of her entry into the 2012 GOP
presidential race, Rep. Michele Bachmann said "scare tactics" are
being used by those warning of an economic calamity unless Congress
raises the government's borrowing limit by an August deadline.

The three-term congresswoman from Minnesota said the U.S. could
avoid a default by paying only the interest on U.S. obligations
while lawmakers work on a deal to cut spending dramatically as part
of a new debt ceiling.

Such an approach has been derided as unworkable by Treasury
Secretary Timothy Geithner.

Bachmann, a tea party favorite, planned to kick off her campaign
Monday in her Waterloo, Iowa, her birthplace. The Iowa Poll
released Saturday night by The Des Moines Register showed her in a
statistical tie with Republican rival Mitt Romney among likely
caucus-goers.

In an appearance Sunday on CBS' "Face the Nation," Bachmann
said she found the poll gratifying but noted that the race for the
nomination was just beginning.

The poll showed Romney with 23 percent support and Bachmann with
22 percent among those who said they were likely to vote in the
nation's first Republican nomination contest.

The top five included former House Speaker Newt Gingrich and
Rep. Ron Paul of Texas with 7 percent each and former Minnesota
Gov. Tim Pawlenty with 6 percent.

President Barack Obama planned separate meetings Monday with
Senate leaders as negotiations on trimming spending and raising the
debt ceiling moved into a new stage. Talks among lawmakers of both
parties ended last week when Democrats and Republicans reached an
impasse over whether there should be any role for additional
revenue in reducing the deficit.

Officials say the nation's borrowing will exceed its $14.3
trillion limit on Aug. 2 and that economic shockwaves around the
world would result from the first financial default in U.S.
history.

"It isn't true that the government would default on its debt," Bachmann said on CBS. She later added, "It is scare tactics."

Geithner, she said, "can very simply pay the interest on the
debt first, then we're not in default."

Geithner has dismissed the idea that the U.S. could avoid a
default by just paying the interest on the national debt and
picking which bills to pay, contending that even trying to do so
would roil financial markets and make it more expensive to finance
what the government does owe.

"There is no responsible path that avoids default, avoids
catastrophe to the economy, that has us decide as a country, we're
going to stop paying all our obligations so we can pay interest,"
Geithner told the House Small Business Committee last week. "It
doesn't work. It's not workable. And it will not relieve Congress
of the obligation of raising the limit."

Bachmann said she wasn't willing to allow the government to keep
borrowing money and putting the country into a worse state.

"One year from now, we'll be back, having this same
conversation," she said. "That cycle has to stop."

Although she once suggested that ending the minimum wage would
be a boon to employment, Bachmann declined to say she would
advocate that position as president and instead would ask a group
of economists to consider the idea.

"I think everything needs to be on the table right now, every
part of government," she said.